I do agree with your friend about the injustice reincarnation and have pointed out its problems before. You have to ask yourself what kind of God would be punishing people for crimes they can't remember committing. Could there be a more ineffective form of punishment than that? The punishment being so far removed from the crime that one is likely to need regular reminding of what he's being punished for. And of course, in practice, nobody ever knows what they are getting punished for. A man born blind has no way of knowing what he did in the past to incur such a penalty. At best he has to rely on shoddy psychics and other hucksters to give him a dubious speculation. With such a harsh punishment, one would think that you'd at least be entitled to know what you were supposed to have done.

The blessed Lord said:

O Arjuna, many births have been experienced by me and by thee. I am acquainted with them all, whereas thou rememberest them not, o scorcher of foes.... Lord Krishna

It is Gods mercy that a benighted soul, ailing from various material discrepàncies, becomes forgetful of these from one incarnation to the next. This oblivion to the miseries and shortcomings of previous existence is one of most gracious of mental anesthetics given by God to each human being, that he not be burdened by memories of all the physical and mental sorrows of past lives. He is spared from carrying with him the evil and discouragements of one life into another and is thus given a fresh start on the straight and narrow path leading to his highest goal. It is enough that proddings of his innate good or evil tendencies- the effects of good or evil tendencies-the effects of good or bad karma of previous lives- remain within him as reminders of lessons yet to be learned and victories already won.

Those evil or good experiences of past lives manifest as evil or good moods or habits from one's very birth in his present life. This fact accounts for persons who are born evildoers and others are born saints. As evil is the harbinger of misery, those who are born evil should strive to work free from their prenatal evil traits by cultivating good company and by meditation. Those who were born good should not be satisfied with their goodness, but should try to be better until they have reached the complete safety of the cosmic spirit and are free from the wheel of birth and rebirth.

God or his incarnations never forgets anything; as soon as the devotee is fully liberated, he too can remember all the various forms he had displayed in birth and lost in death- forms enshrouded in their various achievements as well as they're careless lapses into the ignorance of evils. When the liberated being is awake in God and understands the mystery of this dream of life, only then is he ready for this awesome review.